UK & Europe
Airline carriers generally include baggage requirements in their terms and conditions of carriage. Nevertheless, an air carrier's liability for damage, loss or delay of baggage is governed by a number of overarching international treaties. A recent European Court ruling has narrowed down the issues surrounding the rules on limits to baggage claims under the Montreal Convention 1999.
Co-authored by Nadia Fabri (Clyde & Co) and Sajid Suleman (36 Commercial)
On 9 July 2020, the Court of Justice of the European Union (CJEU) delivered its judgment in the case of SL v Vueling Airlines SA (Case C‑86/19) clarifying the sums passengers can claim for lost baggage and the evidential requirements passengers must satisfy.
SL took internal flights in Spain with Vueling Airlines and checked in baggage with that air carrier. SL’s baggage did not arrive at its destination. SL made a claim for the then applicable maximum limit of 1,131 Special Drawing Rights (as revised by ICAO) laid down in Article 22(2) of the Montreal Convention for compensation for the material and non-material damage caused to her by the loss of her baggage.
Vueling Airlines argued that the maximum limit for compensation laid down in Article 22(2) of the Montreal Convention was not fixed or automatic. SL had not indicated the contents of that baggage, its value and weight or provided supporting documents of the purchases made to replace the items which were in that baggage. For that reason, Vueling Airlines offered EUR 250 in compensation.
Article 17 of the Montreal Convention establishes air carrier’s liability for lost baggage. Article 22(2) limits liability of the air carrier to 1,131 Special Drawing Rights, unless the passengers make a special declaration of interest in delivery at the time of checking in the baggage.
The referring court asked the CJEU the following two questions:
In answer to the first question, the CJEU ruled that the sum provided for in Article 22(2) constitutes a maximum amount of compensation. The passenger concerned does not enjoy this sum automatically and at a fixed rate. It is for the national court to determine, within that maximum limit, the amount of compensation payable to that passenger in the light of the circumstances of the case.
In answer to the second question, the CJEU ruled that the amount of compensation due to a passenger must be determined by the national court in accordance with the applicable rules of national law, in particular in relation to evidence. However, those rules must not be any less favourable than those governing similar domestic actions and must not make difficult the exercise of rights conferred by the Montreal Convention.
Previously, in Walz, C‑63/09, the CJEU ruled that the limitation of compensation under Article 22(2) of the Montreal Convention included both material and non-material damage. The passenger could make a declaration of interest at the time the baggage is checked in, which is the only exception to the absolute limit established under Article 22(2) of the Montreal Convention.
Now in SL v Vueling Airlines SA, the CJEU has clarified that whilst the limit established under Article 22(2) is the maximum sum recoverable, it is not automatic and fixed. The Montreal Convention does not establish a hierarchy of damage to baggage according to their gravity, such that loss of baggage would be considered the most serious for which compensation is automatically due at the maximum amount.
Although it wasn’t noted by the CJEU, Article 29 of the Montreal Convention provides additional support the conclusion reached by the court. Article 29 states that ‘punitive, exemplary or any other non-compensatory damages shall not be recoverable,’ this necessarily means that an automatic, fixed sum could not be awarded for lost baggage as that would be non-compensatory.
The burden is on the passenger who has lost their baggage to establish their loss in accordance with national law. It is for the passenger to provide evidence of expenditure incurred in order to replace the contents of their baggage and the harm suffered. Domestic rules on evidence would apply.
Air carriers may defend claims for lost baggage by putting the burden on the passenger. The judgment in SL v Vueling Airlines SA ensures that passengers are not in for a windfall in receiving maximum compensation for lost baggage without having to prove the losses incurred.